FARRELL, WHEATLAND

Farrell Area School Board, over the objections of three of its members, decided Monday to use additional state subsidy to reduce long-term debt.

The state General Assembly passed its budget after school boards had finalized theirs, giving more money to schools than the Schweiker administration had proposed.

Many schools used the Schweiker administration figure in preparing their budgets.

Farrell will receive an extra $291,929, but the state set specific guidelines on how the money can be spent: to restore programs that were cut in the new budget -- Farrell didn't cut any; to give taxpayers a break -- the board raised taxes 4 mills; or to reduce debt.

The money cannot be used for general expenses or banked in the fund balance, a rainy day savings account.

School Director Edward Zappa, who has never voted for a tax increase during his tenure, asked that the board reduce taxes by 1 or 2 mills.

A mill is $1 for every $1,000 in assessed property value; assessments are a property's 1970 market value.

In Farrell and Wheatland, 1 mill brings the district $51,000.

The administration proposed that all of the money, which will come to the district in four payments over a year, be put into a fund for investment with First National Bank of Pennsylvania, and used for future bond payments.

The money could not be touched until Aug. 15, 2004, when the bonds can be redeemed.

"You will save money, but it will take a period of years to do this," said Business Administrator Ronald Pendel.

Superintendent Richard R. Rubano Jr. said using the money for long-term debt will be "the best bang for the taxpayers' buck."

Zappa, Sadie R. Benham and Joseph "Peppy" Costa voted against the motion, arguing for tax relief of 1 or 2 mills, with the rest going to the debt.

Directors Ronald Weston, James Guerino, Jerome Flint, Larry Manilla, Lester Robinson Jr. and Michael Wright voted for the proposal.

Guerino initially said he supported tax relief but reversed himself. He said he worried about the message giving back money would send to the district's teachers. The district is negotiating a contract with the 95-member Farrell Teachers Association.

"I don't want to create the image that we have money," said Flint, who characterized negotiations as "we're still dancing," and predicted a deal is about a month away.

"We're generous, we want to give back, but we don't have the money," Flint said.

Zappa said he thinks the teachers understand the district's financial position.

"They know we're not crying wolf," added Rubano.

Guerino also fretted over how giving back the money would affect a future budget process.

"If we do give something back, who's to say we won't have to raise taxes that much more next year," he said.

Costa, Wright and Weston said the district will have to raise taxes again next year.

Weston said he didn't want to incur additional expense to give back the money. Mercer school officials estimated it would cost them $12,000 to rebate half a mill.

The money raises the district's new budget to $11,157,057.

You can e-mail Herald Staff Writer Joe Pinchot at jpinchot@sharon-herald.com